Compare solar loan vs lease vs PPA options, see who owns the panels, who gets tax credits, and which deal delivers the biggest long-term savings.

When I first started looking at rooftop solar, I thought the hardest part would be picking panels.

Nope.

The real headache was the contracts.

Three companies came out. All three promised “$0 down solar”.
But one pitched a loan, one pushed a lease, and one was obsessed with their PPA (Power Purchase Agreement).

All three companies considered the same sun exposure, roof type, and number of panels.
But totally different answers to questions like:

• Who owns the system?
• Who gets the tax credits?
• What happens when I sell the house?
• And most importantly: who actually saves the most money?

In this post, I’ll walk you through solar loans vs. solar leasing vs. PPAs in plain English, so you can decide which one actually fits your budget, your risk tolerance, and your plans for your home.

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1. Solar Loans vs. Leases vs. PPAs: The Simple Breakdown

Let’s start with quick definitions.

1.1 What is a Solar Loan?

A solar loan works a lot like a car loan or home-improvement loan:

• You own the solar system.
• A bank, credit union, solar lender, or sometimes the installer finances it.
• You make a fixed monthly payment for a set number of years (often 5–20).
• Once it’s paid off, the system is yours, free and clear.

You’re basically swapping your electric bill for a loan payment + a smaller electric bill.

1.2 What is a Solar Lease?

A solar lease is like leasing a car:

• The solar company owns the system.
• You rent the equipment and pay a fixed monthly fee to use it.
• That payment might stay flat or have a built-in yearly increase (called an escalator).
• You usually have a contract term of 15–25 years.

You don’t pay for the power per kWh. You pay to “rent” the panels.

1.3 What is a PPA (Power Purchase Agreement)?

A PPA is different:

• The solar company owns the system, just like with a lease.
• You don’t pay to rent the system. Instead, you pay for the electricity it produces.
• You pay a set price per kWh (for example, a bit less than your utility rate).
• The rate often increases every year by a small percentage unless you negotiate otherwise.

Think of it as switching power providers on your roof rather than at the grid level.

1.4 Quick-Glance Comparison

Here’s the 10-second version:

• Loan
  • Ownership: You
  • Tax credits/incentives: Usually, you
  • Payments: Fixed loan payment, then $0
  • Upside: Best long-term savings if you qualify and stay put
  • Downside: You take on debt and responsibility
• Lease
  • Ownership: Solar company
  • Tax credits/incentives: Company
  • Payments: Fixed or escalating monthly lease payment
  • Upside: Low or no upfront cost, simple
  • Downside: More complicated when selling/refinancing; long contract
• PPA
  • Ownership: Solar company
  • Tax credits/incentives: Company
  • Payments: Per kWh rate (often with an escalator)
  • Upside: Low upfront, you pay mainly for what you use
  • Downside: Savings depend on utility rate increases; contract complexity

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2. Who Owns the System—and Why It Matters

Ownership sounds boring, but it affects everything: incentives, resale, control, and long-term savings.

2.1 Ownership with a Solar Loan

With a loan, you own the system from day one. The lender just has a lien or financing agreement, like with a car or home improvement.

That usually means:

• You decide on maintenance and repairs.
• You can add panels later (assuming the roof and inverter allow it).
• The system can be treated as an owned improvement to the property.

2.2 Ownership with a Lease or PPA

With a lease or PPA, the solar company owns the system, not you.

That usually means:

• They are responsible for maintenance and performance under the contract.
• You often can’t modify the system without their permission.
• They decide how and when to upgrade or replace equipment.

2.3 Why Ownership Changes the Math

Ownership decides:

• Who gets the tax credits and rebates?
• How your home value may be affected.
• How easy or hard is it to sell or refinance later?
• Whether your savings can grow over time once the loan is paid off.

If you like the idea of solar being a permanent upgrade to your property that keeps paying you back, ownership (loan or cash) is usually more attractive.

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3. Who Gets the Tax Credits, Rebates, and Incentives?

This is one of the biggest surprises for many people.

You don’t automatically get the solar tax credit just because the panels are on your roof.

3.1 Loans: Incentives Usually Go to You

With a loan, you’re typically the system owner, so:

• You’re usually the one who can claim federal tax credits (if you qualify).
• You may also be eligible for state incentives and local rebates.
• Some incentives reduce the effective cost of your system significantly.

You do need enough tax liability to actually use the credit, so it’s worth talking to a tax professional for your situation.

3.2 Leases & PPAs: Incentives Go to the Company

With leases and PPAs, the solar company owns the equipment, so:

• They usually claim the tax credits and incentives.
• In theory, they “pass the savings” to you through lower payments or better terms.
• In practice, you’re trusting their pricing to reflect that.

This doesn’t automatically make leases/PPAs bad, but it does mean you’re not stacking incentives on top of your own long-term ownership.

3.3 Incentives Change the Real Cost Comparison

Two neighbors can have the same system size and the same roof, but:

• Neighbor A buys with a loan and uses tax credits and rebates to lower the total cost.
• Neighbor B signs a lease where the company takes the incentives.

On paper, both got “$0 down.” Over 20–25 years, the financial outcome can be very different.

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4. Lifetime Cost and Savings: Who Really Saves the Most?

Everyone loves to show charts with huge savings curves. The tricky part is what assumptions they used.

4.1 Upfront Cost vs. Lifetime Savings

Roughly:

• Loans: You may put some money down or go zero-down. You may have a payment that’s similar to your current electric bill at first. Over time, once the loan is paid off, your savings can increase dramatically.
• Leases/PPAs: Often no upfront cost. You start saving a bit (hopefully) from day one, but you keep paying for 15–25 years.

If you’re planning to stay put and can handle a loan, ownership tends to win on total dollars saved over the long term.

4.2 Typical Patterns

• Solar loan
  • Best when you stay in the home long enough to pay off or nearly pay off the system.
  • After the payoff, your electric bill is mostly just residual usage and fixed utility fees.
• Solar lease
  • It can be nice if you want predictable payments and don’t want to own anything.
  • But you rarely get that “my panels are now basically free” feeling.
• PPA
  • Attractive when they offer a kWh rate noticeably lower than your current utility rate.
  • Savings depend heavily on how your usage and utility rates change over time.

4.3 Utility Rate Assumptions Matter

Many proposals assume your utility rates will skyrocket every year.

If that happens, your savings look huge.
If they don’t, your “guaranteed” savings may disappear.

When you compare loan vs lease vs PPA, always ask:

• What utility rate increase did they assume each year?
• What PPA or lease escalator did they build in?

If the solar payment is rising faster than your actual utility rates, the deal may get worse over time, not better.

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5. Monthly Payments and Cash Flow

Most of us live in a monthly payment world, not a lifetime model world. Let’s talk cash flow.

5.1 Solar Loan Payments

With a loan, you’ll usually see:

• A fixed monthly payment for the length of the loan.
• A smaller electric bill because the panels offset some of your usage.

For many people, the goal is a “bill swap”:

Electric bill goes down

• Solar loan payment
  ≈ About what you were paying before (or a little less).

The big payoff comes later, when the loan is gone.

5.2 Solar Lease Payments

With a lease, you pay:

• A fixed or escalating monthly lease payment, plus
• A reduced electric bill (since you’re still connected to the grid).

Your solar payment might start below your old power bill, but if it escalates every year, that gap can close.

5.3 PPA Payments (Pay per kWh)

With a PPA, you:

• Pay per kWh for the power your system produces.
• Still get a reduced utility bill because you’re buying less power from the grid.

If the PPA rate starts much lower than your utility rate and the escalator isn’t too aggressive, this can produce steady savings. If the rate and escalator are high, your savings may fade.

5.4 Cash-Flow Scenarios

Here’s how I think about it:

• Tight monthly budget, no savings, short time horizon
  Lease or PPA might be appealing because of the low upfront cost and simple structure.
• Steady income, plan to stay in the home 10+ years, okay with a loan
  A loan can give the best balance of reasonable monthly payment + strong long-term savings.

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6. Selling Your Home with a Loan, Lease, or PPA

This is the part almost nobody thinks about until it’s too late.

6.1 Selling with a Solar Loan

You usually have two main options:

1. Pay off the loan at closing using sale proceeds.
   • The buyer gets a home with owned solar and no solar payment.
2. Transfer the loan to the buyer (if the lender allows it).
   • The buyer takes over the solar payment.

Many buyers like the idea of owning solar, especially if you can show:

• Past electric bills
• Production data
• Warranty information

6.2 Selling with a Solar Lease or PPA

With leases and PPAs, you typically:

• Try to transfer the contract to the buyer, or
• Buy out or prepay the remaining term (if allowed).

Here’s the catch: not every buyer wants to inherit a 20+ year contract they didn’t sign.

If the buyer refuses to assume the lease/PPA, you may need to:

• Pay a buyout amount, or
• Negotiate with the solar company for another solution.

6.3 Tips to Avoid Resale Headaches

Before signing anything, ask:

• How many homes with your contracts have sold in this area?
• What does the transfer process actually look like?
• Is there a buyout schedule in writing?
• Will there be any liens or UCC filings on the property?

If you know you might move in the next 5–7 years, the fine print around resale is just as important as the monthly payment.

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7. Home Value and Refinancing

Solar can be a selling point—or a sticking point.

7.1 Owned Systems (Loans or Cash)

When the system is owned (loan paid off, or you plan to pay it off at sale):

• Appraisers may treat solar as a value-adding improvement, especially with good documentation.
• Buyers often see lower electric bills as a big plus.
• Refinancing is usually cleaner when the system is owned or when the loan is just another line of debt.

7.2 Leased or PPA Systems

With a lease or PPA:

• Some buyers like getting lower electric bills without buying the system.
• Others are wary of long-term contracts, escalators, and “one more bill.”
• Lenders and appraisers may treat the system differently from owned solar.

The key is transparency. Have:

• The full contract is ready.
• A clear summary of monthly payments, escalators, and the remaining term.
• Data showing actual savings if you’ve had the system for a while.

7.3 Solar and Refinancing

Depending on how the financing is structured:

• A solar loan may show up as standard debt.
• Some financing uses UCC filings or other mechanisms that your mortgage lender will want to see.

If you know you plan to refinance soon, it’s worth asking both the solar lender and your mortgage lender how a new solar contract or loan will be treated.

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8. Escalator Clauses and Utility Rate Risk

This is where a lot of people get burned.

8.1 What is an Escalator Clause?

An escalator is a built-in annual increase in your:

• Lease payment, or
• PPA kWh price.

It might be something like 2–3% per year.

That sounds tiny, but over 20–25 years, it adds up.

8.2 When Escalators Break Your Savings

If your solar payment rises faster than:

• Your utility rates, or
• Your income,

Then long-term savings can shrink or even vanish.

Always ask:

• What is the annual escalator on this contract?
• Could I get a flat-rate option (even if the first-year price is higher)?

8.3 What if Utility Rates Don’t Rise as Fast as Promised?

Many proposals assume very aggressive utility rate increases.

If your utility rates don’t cooperate:

• A lease or PPA with a high escalator can end up more expensive than just staying with the utility.
• A loan with a fixed payment looks better and better over time, because your payment stays flat and the panels keep producing.

Conservative assumptions are your friend. I’d rather be pleasantly surprised than disappointed.

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9. Contract Terms and the End of the Line

Solar contracts are long—often longer than car loans and sometimes longer than mortgages.

9.1 Common Term Lengths

• Loans: typically 5–20 years
• Leases: often 15–25 years
• PPAs: often 15–25 years

Equipment warranties and production guarantees may have their own timelines.

9.2 End-of-Term for a Solar Lease

At the end of a lease, you often get choices like:

• Renew the lease (sometimes at a different rate)
• Buy the system (for a set price or fair market value)
• Have them remove the system

Make sure those options (and how the buyout is calculated) are in the contract, not just something the salesperson says.

9.3 End-of-Term for a PPA

PPAs work similarly:

• You might get an option to extend the PPA,
• Buy the system, or
• Have it removed.

Again, the details matter. Don’t rely on “Oh, we’ll work something out.”

9.4 End-of-Term for a Solar Loan

With a loan, the end is simple:

• You make the last payment.
• You own the system outright.
• Panels usually still produce a significant percentage of their original output.

That’s when the real “free-ish power” feeling kicks in.

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10. How to Decide: Loan vs. Lease vs. PPA

Here’s the part where we tie it all together.

10.1 Start with Your Priorities

Ask yourself:

• Is my top priority maximum long-term savings?
• Is it the lowest possible upfront cost?
• Is it simplicity and low mental overhead?
• How long do I realistically see myself staying in this home?

10.2 When a Loan Might Make Sense

A solar loan often fits if:

• You have a decent credit score and can qualify for reasonable rates.
• You plan to stay in the home for at least 7–10 years.
• You’re okay with taking on a fixed monthly payment in exchange for owning the system.
• You want to claim tax credits and build home value.

10.3 When a Lease or PPA Might Fit

A lease or PPA might make sense if:

• You want low or no upfront cost.
• Your credit is okay, but you don’t qualify for great loan terms.
• You value simplicity and don’t want to be responsible for equipment.
• You’re okay trading maximum savings for lower effort and less responsibility.

If you go this route, the key is to fight for good terms:

• Reasonable escalator (or none)
• Clear transfer and buyout language
• Transparent end-of-term options

10.4 Red-Flag Situations

Slow down and get more quotes if:

• The salesperson can’t clearly explain who owns the system.
• They gloss over tax credits or refuse to show how they’re factored in.
• You can’t get a straight answer about escalators or end-of-term options.
• You feel rushed, pressured, or told “this deal expires tonight.”

You’re signing a contract measured in decades, not months. You’re allowed to sleep on it.

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11. Common Questions Asked by Homeowners

1. What’s the difference between a solar loan, a solar lease, and a PPA?

• Loan: You own the system, pay it off over time.
• Lease: You rent the system for a monthly fee.
• PPA: You pay per kWh for the power the system generates.

2. Which option usually saves the most money long-term?
If you qualify for a good rate and stay in the home, a loan + ownership usually wins over 20–25 years. Leases and PPAs can still save money, but often cap your upside.

3. Who owns the panels under each option?

• Loan: You.
• Lease/PPA: The solar company.

Ownership affects everything from tax credits to home value.

4. Who gets the tax credits and rebates?

• Loan (ownership): Usually, you (if you qualify).
• Lease/PPA: Usually, the solar company.

5. How do monthly payments compare?

• Loan: Fixed payment + smaller electric bill.
• Lease: Fixed or escalating lease payment + smaller electric bill.
• PPA: Pay per kWh at a contracted rate + smaller electric bill.

6. What happens if I want to sell my house?

• Loan: You can pay off at closing or sometimes transfer it to the buyer.
• Lease/PPA: You either transfer the contract to the buyer or buy out/presolve it.

7. How do these options affect home value and refinancing?
Owned systems tend to be cleaner for appraisals and refinancing. Leases/PPAs can add complexity and depend heavily on buyer perception and lender policies.

8. Are there escalator clauses with leases and PPAs?
Often yes. Many leases/PPAs have annual payment or rate increases. You want to know exactly what they are and compare them to realistic utility rate increases.

9. What if utility rates don’t rise as fast as expected?
If your utility rates stay flatter than projected, leases and PPAs with escalators can end up saving less than promised—or even costing more over time.

10. What happens at the end of a lease or PPA term?
You may be able to renew, buy the system, or have it removed. The exact options and prices should be in the contract.

11. How do I choose based on my credit, budget, and time in the home?

• Good credit, long time horizon, want max savings → Loan/ownership.
• Shorter time horizon, minimal upfront cash, okay with long contracts → Carefully chosen lease/PPA.
• Unsure? Get quotes for all three and run side-by-side comparisons with conservative assumptions.

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12. Real-World Mini Scenarios

Just to make this more concrete, here are a few common patterns.

Scenario 1: Long-Term “Forever Home” Folks

• Plan to stay 15–20+ years
• Good credit
• Stable income

A loan often makes sense. You get the incentives, build home value, and eventually enjoy years of power with no loan payment.

Scenario 2: Retiree Unsure How Long They’ll Stay

• May move in 5–7 years
• Wants lower bills but doesn’t want more “stuff” to manage

A carefully structured lease or PPA might be okay if the resale and transfer terms are crystal clear and reasonable.

Scenario 3: Budget-Constrained but Wants Solar Now

• Very tight budget
• No savings for upfront cost
• Just wants a lower bill today

A PPA or lease may provide immediate relief without a big cash outlay. The key is to avoid aggressive escalators and understand the long-term trade-off.

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13. Wrapping It Up: Don’t Just Pick “$0 Down”—Pick the Right Structure

Solar is one of those things where the hardware is only half the story.

The other half is the contract.

• Loans, leases, and PPAs can all make sense for the right person.
• Ownership (via a loan or cash) usually gives the best long-term payoff, especially if you’ll be in your home for a while.
• Leases and PPAs can be useful tools—but they need extra scrutiny around escalators, transfer rules, and end-of-term options.

If you’re in the middle of quotes right now, here’s what I’d do next:

1. Get at least one proposal in each format: loan, lease, PPA.
2. Ask each company to clearly spell out: ownership, incentives, escalator, term, transfer rules, and end-of-term choices.
3. Run the numbers with conservative utility rate assumptions, not just their rosy chart.

See the real costs of going solar—panel upgrades, R&R, permits, fees, financing traps, and policy risks—plus scripts and checklists to protect your budget.

I love solar. But I’ve also seen “all-in” quotes turn into surprise invoices.
When I helped a neighbor here in Hawaii compare bids, the cheapest proposal ballooned after the site visit: a main service-panel upgrade, longer conduit run, and a utility meter change. None of it was in the first quote. That experience pushed me to create this guide—so you can spot the hidden costs of solar before you sign.

Use this like a field manual. Skim the TL;DR box, then jump to the sections that match your home. I’ll share the questions I ask installers, the red flags I look for, and simple steps to protect your budget.

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TL;DR Snapshot (Skimmer Box)

• Panel upgrade? Ask for a written load calculation and a capped allowance for service work.
• Roof near end-of-life? Get remove & reinstall (R&R) pricing locked in now.
• Permits + utility fees: Request a line-item list. Who pays for resubmittals?
• Trenching & conduit: Demand a site map with measured runs before you sign.
• Production shortfalls: Get a performance guarantee with clear remedies.
• Monitoring & maintenance: Confirm lifetime portal access and who pays for truck rolls.
• Replacement horizon: Budget for inverter and battery swaps later.
• Insurance: Ask your insurer about premium changes and documentation.
• Financing: Watch for dealer fees, origination, and prepayment penalties.
• Leases/PPAs: Check escalators, buyout tables, and transfer rules.
• Policy risk: Stress-test ROI for TOU windows, export credits, and fixed charges.

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What’s In vs. Out of Your Quote (Scope Map)

Quotes often look comprehensive but hide “exclusions” and “assumptions.” These become change orders later.

Common inclusions

• Modules, racking, inverter(s) or microinverters/optimizers
• Single roof plane wiring runs, standard attachments
• Standard permit and inspection coordination

Common exclusions

• Main service panel (MSP) upgrades or meter combos
• Roof repair/replacement or future R&R
• Trenching, hardscape/landscape restoration
• Structural engineering upgrades for wind/snow
• Utility interconnection fees and resubmittals
• Monitoring subscriptions, cellular gateways, and API access
• Pest abatement/critter guards, cleaning, and data SIM fees

Pro move: Ask for a scope matrix that lists each item as Included / Excluded / Allowance with dollar caps.

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Electrical: Main Service Panel, Wiring & Interconnection

I always start here because electrical surprises are expensive.

When you might need an MSP upgrade

• Existing panel at capacity (no spaces, hot busbar)
• The 120% rule is exceeded with back-feed breakers
• Utility requires a meter/main combo or service relocation
• High continuous loads (EVs, heat pumps) push ampacity limits

Hidden cost drivers

• Panel size (e.g., 100A → 200A), service drop/conductor upgrades
• AFCI/GFCI requirements, relocation, stucco or masonry work
• Revenue-grade meters, current transformers (CTs), production meters

What to ask

• “Please include a written load calculation and interconnection method (line-side tap vs. breaker).”
• “If an MSP upgrade is needed, cap it at $X (allowance).”
• “List utility fees and whether you or the installer pays them.”

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Roof Readiness & Future Reroof Costs

Panels can outlast shingles. If your roof is at the end of its life, consider replacing it before installation.

Key questions

• What’s the roof age and condition? (Get a roof inspection report.)
• Who warrants leak penetrations, and for how long?
• If I reroof later, what’s the R&R price—locked in writing?

Pro move: Ask the installer to include R&R labor pricing now. Future-you will be grateful.

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Permits, Plan Review & Utility Interconnection Fees

Soft costs add up.

You might see

• City/county permit and plan-check fees
• Structural stamps when required
• Utility application, engineering study, inspection, and Permission to Operate (PTO) fees

Time traps

• Resubmittals after plan review comments
• Utility queue delays and re-inspection fees

What to ask

• “Provide a line-item list of all permit/plan/utility fees and who pays each.”
• “What’s the expected PTO date and who handles resubmittals?”

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Trenching, Conduit Runs & Structural/Engineering Changes

After the site visit, real-world distances and obstacles appear.

Typical triggers

• Long conduit runs, difficult attic routes, stucco/concrete coring
• Trenching to detached garages or ground mounts
• Structural adds: purlin reinforcement, additional attachments, higher wind/snow requirements

What to ask

• “Attach a site map with measured conduit length and trench path.”
• “Include one free re-route if field conditions differ from drawings.”
• “List structural assumptions in the proposal.”

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Production Reality: Shading, Soiling & Shortfalls

Models are optimistic. Real roofs are messy.

What dents production

• Seasonal shade paths, neighbor trees, chimneys, vent stacks
• Soiling (dust, salt spray, pollen), high temperature, and inverter clipping
• Performance ratio lower than modeled due to balance-of-system losses

Protect yourself

• Request the shade study (photos, heatmap, or horizon profile)
• Ask for module-level electronics (optimizers/microinverters) where shade is non-trivial
• Clarify the performance guarantee: baseline, exclusions, measurement method, and remedy (cash, extra panels, fixes)

Related read on MicroHomesteader: Clean Solar Panels to Boost Solar Efficiency and What Affects Solar Panel Efficiency?

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Monitoring, Data Access & Ongoing Maintenance

I always check the monitoring fine print.

Look for

• Lifetime portal access (not just the first year)
• Cellular gateway fees vs. Wi-Fi
• API/export access if you like data
• Truck-roll rates for diagnostics, pest abatement, or firmware issues

Ask

• “Is monitoring included for the life of the system?”
• “Who pays for on-site labor during RMAs?”
• “What’s the annual inspection/cleaning price?”

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Replacement Horizons: Inverters, Optimizers & Batteries

Panels often run 25+ years. Electronics don’t.

Typical lifespans (ballpark concepts, not quotes)

• String or microinverters: mid-teens to ~20 years
• DC optimizers: similar to inverter horizon
• Batteries: capacity degrades by throughput and time; plan a mid-life service or module swap

Warranty nuance

• Parts vs. labor
• Battery capacity retention (prorated)
• Who handles shipping and onsite work?

Plan a reserve

• Set aside a small future replacement fund earmarked for inverter/battery events.

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Homeowners Insurance & Roof/Structural Coverage

Solar can change your policy details.

Expect conversations about

• Declared value and coverage limits
• Wind/hail/fire zones and premium adjustments
• Documenting roof penetrations and the installer’s leak warranty

Ask

• “Do you need a completion packet (as-builts, photos, invoice)?”
• “Will my premium change, and by how much?”

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Financing Add-Ons: The “Dealer Fee” Trap

Zero-down looks great until you see the dealer fee quietly inflating the system price.

Watch for

• Dealer fees, origination, deferred interest
• Prepayment penalties or interest-accrual gotchas
• A higher “financed price” vs. “cash price”

Ask

• “What is the cash price vs. the financed price?”
• “What’s the exact dealer fee %?”
• “Can I prepay without penalty?”

Related read: Solar Loan vs Lease vs PPA: Best Option in 2025

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Leases & PPAs: Escalators, Buyouts & Home Sale Transfers

Leases/PPAs can work for some homes, but the fine print decides your savings.

Key items

• Annual escalator (compounds over time)
• Buyout table (early and end-of-term)
• Transfer process when selling your home (credit checks, timelines, fees)

Ask

• “Show the buyout table and escalator in the contract.”
• “What’s your transfer success rate and average timeline?”

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Policy Risk: Utility Rates, TOU Windows & Export Rules

Your savings depend on the rules of the game—and the game changes.

Risks to the model

• Time-of-Use (TOU) shifts that move peak periods later
• Lower net-metering/export credits
• New fixed charges or minimum bills

Protect yourself

• Ask the installer to stress-test ROI with a lower export rate and later TOU peak.
• Consider right-sizing and adding load shifting (heat-pump water heaters, batteries) if policy winds are shifting.

Related reads: Federal & State Solar Incentives (2025 Guide) and The Future of Solar Energy: What’s Coming in the Next 5 Years.

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Contract Red-Flag Checklist

• ☐ Change-order rules and price caps stated
• ☐ Detailed inclusions/exclusions list
• ☐ Performance guarantee terms and remedy
• ☐ Monitoring terms and any subscription fees
• ☐ Warranty covers parts + labor (and leak warranty period)
• ☐ R&R pricing for future reroof (locked amount)
• ☐ Interconnection responsibilities + target PTO date
• ☐ Financing disclosures (dealer fee %, penalties)
• ☐ Lease/PPA escalator and buyout table attached

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“Ask Your Installer”

1. Please include a load calculation and identify the interconnection method.
2. List all permit/plan/utility fees and who pays them.
3. Attach a site map with measured conduit and trenching.
4. Provide the shade study (images/heatmap) and expected performance ratio.
5. Spell out the performance guarantee and the remedy if under-produced.
6. Confirm lifetime monitoring and any cellular fees.
7. Clarify warranty (parts and labor) and who handles RMAs/truck rolls.
8. Lock R&R pricing for a future reroof in writing.
9. Disclose dealer fee %, origination, and prepay rules.
10. For leases/PPAs, include the escalator, buyout table, and transfer steps.

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Example Scenarios (Mini Case Studies)

A. Roof at 18 years
Reroof now + solar once = no mid-life R&R cost and one set of penetrations. Waiting two years would have meant paying for R&R and risking schedule chaos.

B. 100A panel + EV on the way
Installer A ignored it; Installer B showed a load calc and capped an MSP upgrade. The “cheaper” bid wasn’t cheaper after the inevitable change order.

C. TOU shift & evening peaks
Modeling a later peak pushed the homeowner to add a small battery for load shifting. Savings were steadier even after export credits dropped.

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Key Takeaways & Next Steps

• Surprises are optional. Most “gotchas” are visible if you know where to look.
• Demand specifics in writing. Load calcs, site maps, fee lists, and guarantees.
• Budget realistically. Include one-time adders, recurring costs, and future reserves.
• Stress-test your ROI: policy, TOU, and export credit changes—plan for them.

Panels, batteries, rates, VPPs, and permits—see what’s changing in solar over the next 5 years and how to plan a smart, resilient system.

Hi, I’m Crazy Old Prepper. I live small, tinker constantly, and I’m building a micro homestead one practical project at a time. Here’s what I’m watching in solar over the next five years—and how I’d plan a system today so it still feels smart in 2030.

TL;DR Snapshot (Skimmers start here)

• Panels: You’ll see more back-contact / heterojunction / TOPCon first; perovskite tandems will appear in niche retail SKUs, then spread. Expect modest, real-world efficiency bumps on rooftops before major leaps.
• Prices: Hardware keeps trending down long-term, but soft costs (labor, permitting, interconnection) and tariff/supply swings can whipsaw quotes.
• Batteries: LFP (and variants) rule for safety + cycle life; faster installs and clearer throughput warranties.
• Policy: More net billing and time-of-use → batteries move from “nice” to “often worth it.”
• Blackouts: Typical homes land around 10–30 kWh storage with 7–15 kW PV if backup matters.
• VPPs: Virtual power plants expand; payouts depend on your utility + event frequency.
• Permitting: “Instant” approvals spread where AHJs adopt standardized checks.
• End-of-life: Better recycling / take-back programs nudge purchase decisions.
• New use cases: Agrivoltaics, balcony kits, and smarter microinverters open doors for small spaces and small farms.

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Skim-Stopper: Buy Now or Wait?

If your roof is ready, rates are moving to TOU/net billing, and you want blackout resilience, buying now with battery-ready wiring (or a modest starter battery) usually beats waiting for the “next big panel.” If your roof is tight on space, it can be worth waiting for higher-efficiency modules—but I’d still pre-wire.

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1) What New Panel Tech Actually Reaches Homes?

I love reading lab headlines, but I plan purchases around what installers can get, warrant, and service.

What’s real between now and 2030

• Back-contact / HJT / TOPCon continue to replace older PERC: slightly higher module efficiency, better temperature coefficients, and lower degradation.
• Perovskite-silicon tandems: pilot lines and early retail models appear first in premium ranges; ramp depends on durability, encapsulation, and bankability.
• Bifacial on rooftops: helps in high-albedo settings (white roofs, bright ground), less so over dark shingles.

Roof-reality vs. datasheets

• Nameplate jumps don’t always equal kWh gains after you factor tilt, azimuth, shading, soiling, wiring, inverter clipping, and performance ratio.
• Expect incremental roof output gains first; bigger leaps arrive as tandems mature.

Buyer checklist

• Bankability + warranty (product + performance).
• Degradation rate and temperature coefficient.
• Weight, dimensions, and mounting for your racking.
• Inverter/microinverter matching with higher-power modules.

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2) Will Solar Prices Fall—or Whipsaw?

I’ve seen quotes drop on modules, only to bounce from tariffs, freight, or factory ramps.

What drives today’s price

• Hardware: modules, racking, wiring, inverters, optimizers.
• Soft costs: design, permitting, inspections, labor, overhead (these often dominate).

What pushes up or down

• Trade actions & tariffs, shipping costs, polysilicon cycles, and U.S. manufacturing build-outs.
• Local labor markets and AHJ requirements can swing bids more than module prices.

Practical moves

• Get multiple quotes within a 2–3-week window.
• Ask for price-hold windows and clarify escalation clauses.
• Lock interconnection steps early to avoid delays.

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3) Batteries: Safer, Longer-Lived, Easier to Install

I favor LFP for home storage: stable, predictable, widely supported.

Chemistry & form-factor trends

• LFP / LFP-plus dominate for safety and cycle life.
• Modular cabinets and pre-wired enclosures shorten install time and clean up the look.

What to compare

• Round-trip efficiency, continuous/peak power, depth-of-discharge, and usable kWh.
• Throughput warranty (total MWh over life), not just years.
• DC-coupled vs AC-coupled: DC can be more efficient in solar-charging paths; AC is easier to retrofit.

Buy now vs wait

• If you have TOU rates or frequent outages, consider buying now.
• If you’re purely chasing export arbitrage, wait to see your utility’s net billing math.

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4) Net Metering → Net Billing + TOU: Do Batteries Become Essential?

We’re seeing a steady move from classic net metering to net billing with time-variant export values.

What that means for your bill

• Daytime exports may be worth less; evening peak power costs more.
• A battery lets you shift solar from low-value hours to peak hours.

Sizing rules of thumb

• Daily bill shaving: size for 3–5 hours of evening peak loads.
• Resilience + bills: split capacity—reserve 20–30% for outages; use the rest for TOU.

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5) Blackout Readiness: Typical Solar + Battery Sizes by 2030

I plan for critical loads first (fridge, lights, internet, a few outlets), then decide if whole-home is worth it.

Typical pairings I expect to keep seeing

• 7–15 kW PV with 10–30 kWh storage for most homes wanting a day of resilience + TOU shifting.
• Multi-day coverage needs load management, conservative thermostat settings, and sometimes a generator hybrid.

Step-by-step

1. List critical loads and watts.
2. Decide hours of coverage (8–24+).
3. Calculate usable kWh (account for DoD and reserve).
4. Check inverter power for motor starts (soft-start helps).

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6) Will Virtual Power Plants (VPPs) Actually Pay?

VPPs stitch together thousands of home batteries to help the grid.

How it works

• You opt in; the aggregator schedules limited dispatch windows.
• You get credits for capacity and/or energy delivered during events.

What matters to a homeowner

• Payout structure: $/kW-month, event payments, or bill credits.
• Cycling impact: confirm warranty allowances for third-party dispatch.
• Opt-out controls: can you set reserve for your own backup?

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7) Permitting & Interconnection: From Weeks to “Instant”

I’m excited about standardized plan sets and automated checks.

Faster paths

• Jurisdictions adopting instant permits for standard rooftop designs.
• Utilities offering online interconnection portals, clear smart-inverter settings, and pre-approved equipment lists.

Your action list

• Ask installers if they use standardized plan sets eligible for same-day approval.
• Confirm interconnection timelines before you sign.

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8) Incentives: What’s Likely, What’s Sunsetting

Policy changes, but a few patterns help planning.

Baseline to know

• The federal ITC covers qualified solar + storage; storage eligibility is now broader.
• State / utility adders come and go: battery rebates, performance-based incentives, and low-income carve-outs.

Planning moves

• Time your paperwork: claim in the year the system is placed in service.
• Track basis reductions for certain rebates.
• If you’re a business, consider depreciation and bonus incentives.

For details, start here: 2025 Solar Incentives & Tax Credits Guide.

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9) Smarts Everywhere: Inverters, EV Chargers, V2H/V2G

The home is becoming an energy orchestra.

Device roles

• Smart inverters manage grid ride-through and volt/VAR.
• Load controllers and smart panels shape when big loads run.
• EVSE integrates charging with solar and rates; bidirectional units add V2H/V2G potential.

Design patterns I like

• A critical-loads subpanel for clean backup.
• Whole-home transfer only if you size for it (or accept managed loads).
• Leave space in the main panel for future EV + battery expansion.

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10) End-of-Life: Recycling, Reuse, and Warranties

End-of-life rules are tightening, which is good for the ecosystem.

What to watch

• Take-back programs from manufacturers and regional recyclers.
• Clarify product vs performance warranty, RMA process, and transferability if you sell the home.

Buy with the end in mind

• Favor bankable brands, transparent recycling partners, and clear support channels.

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11) New Use Cases: Agrivoltaics, Balcony Kits, Micro-Inverters

Small spaces and small farms get real options.

Agrivoltaics

• Elevated racking for shade-tolerant crops, fencing for animal safety, and careful row spacing for equipment access.

Balcony / plug-in kits

• Great for renters/condos where allowed. Check utility rules, rapid-shutdown compliance, and GFCI details.
• Expect modest yield—nice bill trim, not whole-home power.

Micro-inverter / optimizer roadmap

• Higher per-module power ratings, robust rapid-shutdown, cleaner module-level monitoring, and better salt-mist/wind certifications for coastal roofs.

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Mini-Calculators (Quick Math You Can Do)

Battery value under TOU
(kWh shifted to peak each day) × (peak – off-peak rate) × (days/month)

Blackout coverage estimate
(Critical-load watts × hours needed) ÷ (usable kWh) → sanity-check your size

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Simple Flowchart: Buy Now vs Wait

• Tight roof space? → Consider waiting for higher-efficiency modules or use premium-efficiency now.
• Rates moving to TOU/net billing? → Add a battery or at least battery-ready wiring.
• Frequent outages? → Prioritize backup now; consider V2H-capable EVSE later.
• Slow permitting in your area? → Choose an installer with standardized plan sets and clear interconnection playbook.

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Installer Checklist

• Module tech: TOPCon/HJT/back-contact? Warranty (product + performance)?
• Battery: Usable kWh, throughput warranty, round-trip efficiency, continuous/peak power.
• Inverter: Smart functions, rapid shutdown, EVSE integration.
• VPP eligibility: Payouts, cycling policy, opt-out.
• Paperwork: Permit timeline, interconnection steps, incentive forms.

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Helpful Next Reads on MicroHomesteader

• How Solar Works (Beginner Guide)
• Solar Panel Efficiency: Real-World Factors
• 2025 Solar Incentives & Tax Credits

Verify credentials, compare bids fairly, sanity-check savings, pick the right financing and gear, and avoid red flags.

TL;DR for Skimmers

• Check credentials: license, insurance, NABCEP.
• Warranties you can use: workmanship, equipment, and roof penetration.
• Compare bids apples-to-apples: models, DC vs AC kW, assumptions.
• Pressure-test savings: shade study, weather data, utility rates, buyback.
• Match financing to your goals: cash, loan, lease/PPA.
• Pick the right design: string vs microinverters/optimizers; battery-ready.
• Trust but verify: reputation, monitoring, service SLAs—plus roof and incentives details.

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Introduction: The quote that made me pause

When I got my first solar quotes, the sales pitch was smooth. The numbers looked great. Then I asked for the license number and insurance cert—and the tone changed. That moment taught me the difference between a friendly salesperson and a professional solar installer who will stand behind their work for 25+ years.

If you’re feeling a little overwhelmed by acronyms (NABCEP, PR, NOCT), rate plans, and warranty fine print—breathe. In this guide, I’ll walk you through exactly how I vet installers, what I request in writing, and the red flags I avoid. It’s simple, repeatable, and it works whether you’re grid-tied, hybrid, or planning a battery later.

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Tip 1: Verify Credentials (License • Insurance • NABCEP)

Goal: Confirm you’re hiring a qualified, insured contractor—not a pass-through sales outfit.

What I ask for (in writing, as PDFs):

• State contractor license number + link to the state lookup page.
• General liability (commonly $1M+) and workers’ comp certificates with active dates.
• NABCEP certificate number and credential (e.g., PV Installation Professional).

In this post, I will share valuable tips on how to choose a solar installer that best fits your needs.

In this article, I will explain how to choose a solar installer to ensure you make the best decision for your solar needs.

In this guide on how to choose a solar installer, I’ll walk you through exactly how I vet installers, what I request in writing, and the red flags I avoid.

In this article, I will also share insights on how to choose a solar installer effectively.

In this guide on how to choose a solar installer, I’ll walk you through exactly how I vet installers, what I request in writing, and the red flags I avoid.

In this guide, I’ll also explain how to choose a solar installer to ensure you make the best decision for your needs.

Quick checks:

• License is active, classification includes solar/PV, and company names match.
• The insurance holder is the same entity on the contract.
• The NABCEP credential is current and actually tied to the people overseeing your job.

In this guide on how to choose a solar installer, I’ll walk you through exactly how I vet installers, what I request in writing, and the red flags I avoid.

Red flags: “Our partner is licensed,” expired policy dates, and no NABCEP anywhere on the team.

Skim-Stopper: Ask, “Who is the license holder of record for my project?” Write the name down.

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Tip 2: Warranties You Can Actually Use

Not all warranties are equal. Get documents, not promises.

Three buckets to confirm:

1. Equipment warranties
   • Panels: product & performance (e.g., 25-yr output retention),
   • Inverters/microinverters/optimizers: product term and replacement policy,
   • Racking: corrosion/structural coverage.
2. Installer workmanship (craftsmanship, wiring, conduit routes): 10+ years is common.
3. Roof-penetration/leak coverage: who pays, response time, and documentation required.

What to capture:

• Term lengths, claim process, and who you call first.
• Transferability if you sell the home.
• Exclusions (salt spray, coastal corrosion, critter damage, misuse).

Red flags: “We’ll handle it” without PDFs; roof coverage shorter than workmanship; warranty only valid if you buy add-on services.

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Tip 3: Apples-to-Apples Bid Comparison

Bids are only comparable if they use the same assumptions.

Standardize these line items across all quotes:

• Panel model + wattage (datasheets linked).
• Inverter type (string vs microinverters vs optimizers).
• Array size: DC kW and AC kW (both).
• Tilt/azimuth, shading %, performance ratio (PR), annual degradation %.
• Monitoring (owner access, alerts), racking, and balance-of-system.
• Main-panel upgrade (MPU) requirement, meter location, conduit routing.
• Battery compatibility (communications, UL9540, warranty alignment).

Price sanity: Track $/W DC and $/W AC, but never alone—consider Year-1 kWh and system quality.

Skim-Stopper: If a bid won’t list exact models and assumptions, I stop there.

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Tip 4: Pressure-Test Production & Savings Claims

Pretty charts are easy. Evidence is harder.

Ask for:

• Shade study with an on-site tool (e.g., SunEye) or lidar-based modeling.
• Weather dataset used (TMY/typical meteorological year).
• Hourly modeling that matches your rate plan and export/buyback rules.
• PR (performance ratio) and degradation assumptions (e.g., 0.5–0.8%/yr).

Do a quick sniff test:

• Year-1 kWh vs DC size—does it match your site and tilt?
• Are rate escalation assumptions realistic?
• Does the cash flow include any dealer fees or loan points?

Red flags: “Up to” savings, no shade file, no hourly modeling, or using an old net-metering policy that no longer applies.

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Tip 5: Financing That Matches Your Goals (Cash • Loan • Lease • PPA)

Ownership drives incentives and long-term ROI.

• Cash: Lowest lifetime cost; you own the equipment and claim any eligible tax credits.
• Loan: You still own the system; confirm APR, term, fees, prepayment rules, and any UCC-1 filing.
• Lease/PPA: Low upfront, but the third party owns it and typically claims incentives. Watch the escalator.

What I request in writing:

• Who owns the system?
• Whether I’m eligible for the federal ITC.
• Total finance charges and fees.
• Escalator % for lease/PPA.

Rule of thumb: If you can handle the payment and want maximum control, cash or a transparent loan usually wins long term.

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Tip 6: Choose Equipment & Design for Your Use Case

Match the architecture to the roof, shade, and future plans.

String inverters

• Great for simple, unshaded roofs; fewer electronics on the roof; central point of service.

Microinverters

• Best for complex roofs, multiple facets, or partial shading; module-level monitoring; flexible expansion.

DC optimizers + string

• Middle ground; good shade tolerance with a central inverter.

Battery-ready design

• Confirm communications compatibility, breaker space, rapid shutdown, and UL9540 listings.
• If backup is the goal, specify the critical loads panel on day one.

Extras that matter: critter guards, coastal-grade fasteners, wind/salt exposure considerations, clean conduit runs.

Skim-Stopper: “One-size-fits-all” is not a design—ask for the why behind each component.

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Tip 7: Reputation, Service, and Support After the Sale

You’re marrying the installer for the next decade. Pick someone who answers the phone.

How I vet beyond testimonials:

• Local references from the last 6–12 months.
• Permit history with your AHJ (shows real, recent volume).
• Complaint records and how the company resolved them.
• Years in business and leadership with verifiable track records.

Service terms I want in writing:

• Monitoring access for the homeowner, with uptime alerts.
• Response SLA (e.g., triage in 2 business days; on-site within X days for leaks/failures).
• Truck-roll fees (if any) and what’s covered under workmanship.

Red flags: Third-party monitoring only, no written SLA, or “call the manufacturer” as the default.

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Project Timeline & Common Delays

Typical flow (your mileage may vary):

1. Site survey → photos, roof/attic/electrical.
2. Design & engineering → one-line diagram, structural calcs if needed.
3. Permits → AHJ review.
4. Install → usually 1–3 days for residential.
5. Inspection → local authority sign-off.
6. Interconnection → utility approval, meter, or PTO.

Common delays: AHJ backlog, utility queue, main-panel upgrades, reroof scheduling, special-order equipment.

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Roof Condition, Structural Work, and Leak Liability

Before anyone steps on the roof, align on conditions and responsibilities.

• Request a pre-install photo log of decking, underlayment, penetrations, and attic areas.
• If a reroof is coming within ~3–5 years, strongly consider doing it first.
• Clarify who pays if hidden damage is found.
• Get leak liability and response times in writing.

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Incentives & Taxes (ITC + State/Utility)

• The federal Investment Tax Credit may apply if you own the system; you typically claim it in the year it’s placed in service.
• Some rebates can reduce your project’s tax basis; certain production credits may be taxable income.
• Leases/PPAs: the system owner (often the financier) usually claims the credits.
• Many states/utilities offer incentives or export/buyback programs—ask who files that paperwork and when.

Pro tip: Look up incentives in one place with databases like DSIRE. Ask your installer to list every program they’re assuming.

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15 Questions to Ask at the Site Visit

1. Who is the license holder for my project?
2. Will you use employees or subs? Who carries workers’ comp?
3. Can I see the shade study file and the assumed PR/degradation?
4. Which rate plan and export/buyback did you model?
5. Why this inverter architecture for my roof?
6. Is the system battery-ready? Which models integrate cleanly?
7. Will I need a main-panel upgrade? Who coordinates it?
8. How will conduit be routed (aesthetic plan)?
9. What’s the monitoring platform and alerting?
10. What’s your response SLA for leaks/inverter faults?
11. Do you install critter guards or corrosion-resistant hardware for coastal sites?
12. What’s the roof-penetration detail (flashing, sealants)?
13. Who handles permits and interconnection paperwork?
14. What are the warranty exclusions I should know about?
15. Can I speak to two recent local customers?

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Red Flags & Deal-Breakers

• Won’t share license/insurance PDFs or the shade file.
• Vague equipment models (“Tier 1 panels”).
• Savings claims based on old net metering rules.
• Pushy “today-only” discounts.
• No written roof-leak coverage or service SLA.

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Mini-FAQ

Are microinverters worth it on a simple south roof?
If shade is minimal and the roof faces due south, a quality string inverter can be efficient and cost-effective. Microinverters add module-level monitoring and shade resilience; decide based on roof complexity and future expansion.

Can I add batteries later?
Yes—if the system is designed for it. Confirm communications compatibility and breaker space now to avoid rework later.

What if I need a reroof in 3 years?
Either reroof first or plan for detach & reset costs later. Get both numbers now.

Who handles interconnection?
The installer usually submits and tracks the interconnection. Ask for a copy of the final permission-to-operate (PTO).

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Practical Takeaways

• Standardize quotes. You’ll see who’s real fast.
• Get every promise as a document.
• Choose a design for your roof and goals, not a sales script.
• Tie financing to ownership and incentives.
• Service after the sale matters for 10–25 years—treat it that way.

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Resources

• Understanding Solar Power
• Optimal Angle & Placement for Solar Panels
• What Affects Solar Panel Efficiency?
• How Much Do Solar Panels Cost in 2025
• Solar Panel Cleaning Guide

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Helpful External References

• NABCEP certification lookup (verify installer credentials)
• State license lookup (your state contractor board)
• DSIRE (state and utility incentives database)